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Hundreds of thousands “will plunge into poverty” as Minister rejects UK-wide call to keep Universal Credit uplift

01 September 2021

The Work and Pensions Secretary, Dr Thérèse Coffey, has rejected a call by cross-party committees from Westminster, the Northern Ireland Assembly, the Welsh Senedd and the Scottish Parliament.

In a joint letter, sent in July, the cross-party committees had called on the Government to extend the £20 a week increase in the standard allowance of Universal Credit, which is due to end in October and to extend the uplift to legacy benefits.

It means the standard UC rates will go down to £257.33 a month for single claimants aged under 25, or £324.84 a month for single claimants over 25.

But the Secretary of State’s response confirms that the increase will end as planned on 6 October. She says:

“Now the economy has reopened it is right that the Government should focus on supporting people back into work and supporting those already employed to progress in their careers. Our ambition is to support two million people move into and progress in work through our comprehensive £33 billion Plan for Jobs.”

Government statistics show that there were six million people receiving Universal Credit by January 2021, up from about three million in March 2020.

On 8 September, the Work and Pensions Committee will hear from people with personal experience of claiming Universal Credit during the pandemic. The hearing takes place.

Rt Hon Stephen Timms MP, Chair of the Work and Pensions Committee, said:

“The £20 cut will plunge hundreds of thousands, including children, into poverty. Instead, the Government should extend the lifeline beyond September.

The Secretary of State’s dismissive response to our letter suggests that the Government is still in denial about the impact of ending the increase.

The Government’s new employment support schemes are welcome, but 40% of Universal Credit claimants are already in work. The cut will hit many working families hard.

Benefit rates have not kept up with the rising cost of living, and the Government’s plan means that, in real terms, they will fall to their lowest level in over 30 years. The Government must change course to prevent severe hardship for many thousands of families.”

Last week,  the Disability Benefits Consortium (DBC) published new research - The Millions Missing out - highlighting that thousands of Disabled people on out of work benefits, such as ESA are facing considerable mental health and physical challenges as the pandemic has left them struggling financially, new research shows.

In a joint letter of 30 August, the devolved governments of Scotland, Wales and Northern Ireland also called for the UC and tax credit £20 uplift, but to instead make it permanent.

All those on legacy benefits like ESA were excluded from the £20 week UC uplift.

Ella Abraham, Z2K’s Policy and Campaigns Manager and Campaigns Co-chair of the DBC, said:

“It’s been 18 months of discriminatory Government excuses which have continued to leave 2.5 million people without the vital income they need to support them throughout the pandemic and beyond.

The Government must end this two-tier welfare state to ensure Disabled people and those with health conditions aren’t pushed any further into poverty and destitution.”

For more information see Thousands face ‘severe hardship’ as Minister rejects UK-wide call to keep Universal Credit uplift available from committees.parliament.uk.

See also our realted news story Broken benefits system forcing thousands of Disabled people to fall behind on payments and skip meals.